UNTHINKABLE Risk. UNTHINKABLE Reward. The 4 AI Stocks That Could Make Millionaires

Trillions of dollars is being spent on the AI infrastructure buildout. But will all of the companies behind this buildout actually make it to profitability? Joining us today is Marketbeat analyst Chris Marotch with a list of the top four data center builders out there. And we are going to cover whether or not the risk they're taking will pay off long term. We're going to go down the list from the the least risky of these AI data center landlords to the most risky AI data center company out there. and why that risk is there. So, a lot to talk about today, Chris. These are some really big growth stories right now in the market. But first off, just talk about this group of stocks that we're talking about. When we say AI, data center landlords, what do we mean? So what we're talking about, Bridget, are the companies that are working very hard and very quickly and spending a lot of money to do so on getting these gigantic data centers built out so that the hyperscalers like Microsoft and Amazon and Meta can actually have a place to house the large language models that are that are needed to fulfill this demand that's out there. >> Yes. So they're essentially building a mall to put it in in terms that we understand today. They're building the mall and hoping that these stores will come in and rent store space inside their mall except change that mall to AI capacity. Correct. >> Correct. And that's actually one of the reasons why you've seen a company like Nvidia invest in several of the companies that we're going to be talking about today because Nvidia gets it. They understand that they need to have their equipment in these spaces where it's going to get used and these companies look like the right bets for them to do it on. And I think one thing to to do as we start this Bridget is I'm giving out four names today. This isn't an exhaustive list by all means, but these are four of the top names and these are the names that tend to be getting brought up on a regular basis, especially during earning season. Yes, we're starting to see that investment coming from a lot of these hyperscalers like you mentioned and there's good reason for it. These companies are spending millions making sure their most important data lives in a secure, organized place, and your personal financial life deserves the same thing. Thank you to Monarch for sponsoring today's video. I have been using this app for a few months now, and I have to say it has genuinely changed the way me and my family approach finances. It tracks everything all in one place. From my own investments to my personal paychecks, my expenses, all of my credit cards, all on one clean dashboard. 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And and that's the thing that we've seen this earning season that really has lifted the market over the past month. You heard it from the hyperscalers that this demand existed and then you heard from these companies that said, "Yeah, the demand really exists." So it was kind of a a checks and balances. You didn't just hear Microsoft saying, "Yeah, the demand exists." You're hearing now companies that are customers of Microsoft saying, "Yes, Microsoft is paying us. Demand is real." >> Yeah, we've absolutely seen that and you will see that show up in the stock charts on the four names that we are going to share here today and talk about. One more thing to talk about is the risk that's involved here. When we're talking about this much capital, how much money it is actually taking to build out this AI infrastructure, you have to also talk about the risk involved because these four names that we're talking about today, they are all working incredibly fast. It's really kind of a race to see who can get up these data centers first to help rent out the space to the hyperscalers and other other companies that want this space uh and have the demand for this space. So what risk is involved when there is so much capital being made right now to actually put these buildings up? >> Yeah, the biggest risk right now is that these companies are financing this via debt. None of the companies that we talk about today are profitable yet. And that in and of itself is not a good or a bad reason to invest in the company. That's why we're framing this in the context of risk Bridget because these companies are competing for capital and unfortunately for them right now they're starting to compete with some of the hyperscalers that are their customers for that same capital. private equity has a choice between investing giving that capital to a Microsoft or an Amazon very well- capitalized companies or going to companies that in some cases what we're talking about today are not even investment grade companies okay that's where a risk may lie >> yes and we'll dive into the risk of each of these stocks but also the potential reward and that reward we have certainly seen over the past year or two so let's just get into this list what is the first company uh that you want to talk about today as the AI data and our landlord and we are starting with the least risk. What's that company? >> Each one of these is carries a little bit of a different profile. Nebius is the first company we're talking about, ticker symbol NBIS. They would be considered um a vertical integrator in this data center market. They're trying to build out an AI neocloud platform. You're going to hear that word a lot now. Neocloud, this new cloud platform. And what Nebius does is they combine owned power, GPU capacity, cloud services, inference tools, and large customer contracts within their business model. They're positioning as what they're calling themselves as a full stack AI infrastructure company. Year to date, the stock's up about 165%. I think it's the strongest performer among the group of stocks we're talking about, at least the last time I checked. They've been a really solid performer. They've got that vertically integrated positioning and I think among these four stocks, they carry the least risk. I'd give them on a scale of one to 10, I'd say they're probably about a four. They're probably the most defensive play of all the group. They actually have more cash than total debt and the short-term assets that they have can cover their short-term liabilities. They also have less customer concentration risk because yes, they do have customers with Meta and Microsoft, but they also have contracts with a bunch of smaller enterprise numbers. >> Yeah, I think the diversified contracts make a really big deal for these names because if you have all of your eggs in one basket, it can it can crash a project pretty quickly. So, that's a great point. Nebas also, I want to talk about the stock performance. This one has been huge. It was the very first name I added onto my Bridgette Spies watch list when we started back in November. If you haven't seen that watch list yet, you can scan the QR code or click the link in the description to follow along with some of the stocks we talk about on this channel. I've been adding about one stock per video that we talk about. And again, Nebius was the first one I added back in November, and it is up over 150% for me on this watch list since that time. So, it's had a crazy run in just a few months. Why are we seeing so much excitement around this name? Well, you know, I think this goes back to what we were talking about at the start of the video. Bridget, if you looked at the stock chart, it sort of tells the story very well. Coming out of 2025, heading into 2026, the stock was kind of chopping around in a range. And that's because the entire investment community started started becoming a little bit scared that all this money was going to go into data centers. Where was the payoff going to be? Were these hyperscalers really going to be committing that kind of capital to these data centers? Did was there was the demand really there for the hyperscalers to continue to invest? What we've learned this earning season is yep, the demand's there. And we've heard it from Microsoft. We've heard it from Amazon. We've heard it from Meta. And now what we're doing is we're hearing it from the companies like Nebius who are confirming what they've heard. And so now that demand risk is turning into bullish sentiment which you're seeing on the Nebia stock chart. >> Yeah, you're see it in the stock chart, but you're also seeing it even in Nebius's earnings. Of course, these are negative earnings. It's not profitable yet, but you can see a massive beat on expectation for Nebius. Um, and I know we've seen a few of the names on this list have quarters like this. And so I'm curious, is this a trend? Do we expect to see these kinds of names continue to see earnings beats or will it take time? Will there be some back and forth simply because of the large numbers of debt versus a new contract that might come on one quarter? That sort of thing. >> The thing that investors are going to want to watch for in the short term, and it might seem kind of counterintuitive with how we've been talking about this, Bridget, but they're going to be wanting to look at the top line right now because you're going to want to see these companies beat convincingly on the top line on a quarter-over-quarter basis. And if they do that, then they'll certainly be beating it on a year-over-year basis because you said it very well at the beginning. It's sort of like a race right now, but in my mind as an investor, it's a race for these companies to see how quickly they can drive that top line so that they can start seeing that bottom line turn positive. And that's in the time that they have without having to to dip too much further into debt, which could be dilutive to shareholders. >> I think that's a good race to keep an eye on for sure. The other one is the the more visible race and that's getting actual buildings up and functional that can be rented out for space that can actually bring in the profit. Do you know where Nebia stands on that race right now? How are they doing at actually getting those data centers up and functional all over the globe? >> At face value, this may not sound that big, but when you consider how big these data centers are, this is a big number. So Nebius had two data centers at the end of 2024. They expanded that to seven by the end of last year and by the end of this year they're planning on expanding that to 16. The thing is Bridget and we'll be talking about this throughout the video is that's not even nearly enough for what AI is going to need down the road because we're just tickling on the very beginning of this right now. Yes, that's exactly the thesis of this video is that these uh companies are rapidly working to add the numbers of data centers that are functional and it's not fast enough for the demand that's out there. So, it's still a very interesting growth story. Clearly, these stocks have run quite a bit. Nebius has had a great run, but it does still feel like the early stages of the stock to me. Does that seem like the case for you, Chris? >> It does. I think I think there is still an early case to be made and I think the thing that investors are just going to have to watch for is when a stock like Nebius makes such a strong aggressive move to the upside. It's not a bad idea to maybe trim your position a little bit. Not exit the position, but trim it a little bit unless you're a momentum trader and you're going all in and all out, but I'd say just trim the position a little bit. Expect that you might get a little bit of a pullback and then wait for that next leg up. >> All right, so that's the first one. And this was the least risky of the AI data center landlords. Let's move on to that next company on the list. And this moves down a little bit into the more risk category. >> The name I've got on my list here is Iron. Uh ticker symbol is Irn. They were a Bitcoin miner. They were all in on that sector and they've been making this pivot away from becoming a Bitcoin miner and they've actually stopped that. They've stopped expanding their Bitcoin mining operations. They're redirecting capital towards building out these AI data centers and the cloud infrastructure. The big story with Iron right now is they have a $9.7 billion contract with Microsoft. They've got a separate $3.4 billion 5-year AI cloud contract with Nvidia. It's going to be that topline number that you're going to be want to be watching. To put that $4.4 four billion dollar annual run rate into context. They're trailing 12 month revenue is probably maybe just a little over a billion dollars. So you're basically saying they're going to have a contract there that's going to 4x their current revenue situation. Iron's been a company that kind of got the attention of the retail community and they've been the one that's been really driving the stock, but it's starting to get a little bit more of that institutional focus. In the third and the fourth quarter of 2025, there was strong institutional buying, especially in the fourth quarter and in the first quarter of this year. Actually, that's continued. The way I'm seeing it right now um on market beat is right now institutional buying outweighs selling by about 3 to one and that's most of that's happened in the last three quarters. So institutional ownership still only about 41% of that of this company's stock. That means there's still an on-ramp for retail investors to get in before that institutional money really arrives heavily. It's also one of the exciting things about irony in that context. Yeah, this is a name that came up a little over a year ago during our Monday live streams. If you are are not a subscriber on the channel yet, you should absolutely make sure to hit the subscribe button so you know every time we go live. But we are live with Chris and Thomas uh from Marketbeat on our channel every Monday at Market Close going over any stocks that people want to talk about. And a viewer brought this stock up again over a year ago almost and it has grown so much since then. But as you said when we started this video, these four names aren't the only ones who are doing this. And there are quite a few of those former Bitcoin miners who are working to make the pivot that Iron did. And that is moving from Bitcoin mining into AI data center space. So there's plenty of different names out there. Iron's just much further ahead than what some of those other smaller players are doing right now. >> Yeah. And one of the reasons for that is cuz they had just they had tremendous cash flow coming in from Bitcoin, especially at a time when we were coming out of 2024 when Bitcoin made that massive ramp up to 125. They have a base of capital that some of these other neoclouds just don't have. Plus, now they have contracts from Microsoft and Nvidia that are actually getting institutions a little bit more excited about the stock. >> Yeah, let's talk about why this one uh was higher up on the the list of less risks compared to the other two names that we're going to have. What makes Iron a little less risky? Is it just having that capital capital available from Bitcoin? >> Yeah, I think so. I think it's it's the combination of the revenue that they have from the Bitcoin mining operations plus the fact that they have the major contracts already. Like anybody, they're still having to raise capital. It's that that in and of itself isn't going to make the company profitable. Dilution for Iron has been a real thing and shareholders bear the cost of that. But it's looking like that dilution is becoming less of a risk, but I think the risk is still there. So on a scale of 1 to 10, I'm putting iron in that 56 range. So if Nebius is like a four, iron's probably just a little bit above that, around a five or six. >> Let's talk about uh where Iron sits in that race compared to the the the pace at which Nebius is putting up data centers. Let's look at the number of data centers and the physical footprint that Iron is having across the globe. One of the things that makes iron attractive to some of the hyperscalers is energy is a big deal with the data centers and iron powers all of their data centers with renewable energy sources. For example, they have three data centers that are currently operational in Canada. All are being operated with hydro power. All three are in British Columbia. They're all being powered with hydropower. They also have two uh data centers operational in Texas on the ERCO grid. They have another one in Texas that's under construction and they're targeting that to be ready by late 2027. Plus, there's another one in their pipeline which they're building in Oklahoma and that is targeted for sometime in 2028. The other thing that that is telling you these projects have a long timeline on them. But that also means that that means patience for investors. >> Yeah. Patience for investors. The the growth story on these names is not even close to being uh to playing out yet because right now they're in the let's spend cash phase. And we do plenty of other videos talking about the AI infrastructure buildout and all of the other names who are doing the building and are benefiting from the capital that names like I are doing to to put up these data centers. But that's a different part of the story. Today we are talking about the growth potential for Iron once these are up and fully functional. What do you think the the the profitability timeline is for a company like Iron and really all of the names that we're talking about right now? How long to profitability? >> That's anybody's guess, but my my thinking is we're probably looking into late 2027, early 2028 at the earliest uh to see these companies get uh get profitable. And I think when I say that, I'm talking probably on an adjusted EPS basis. GAP profitability probably we're talking about later in 2028 and beyond. And again, I think that's just a that's just a story of they've got to spend money to make money and right now they're having to spend a lot of money to get these data centers built. >> That is true. And that is true for our next name on the list, too. Let's get to the third AI data center landlord that you are looking at today. >> Yeah. So the next one that I'm looking at here is um is cororeweave. Where it fits in with this whole narrative is cororeweave is considered I guess the bellweather in this sector. It's probably one of the purest examples of what you were talking about Bridget in terms of cororeweave being the landlord. They are you know their revenue their backlog their customers their capital needs are all tied directly to this need for AI cloud capacity. They've expanded from three data centers at the end of 22 to 43 data centers today. So they're one of the companies that is leading the way in terms of having a number of facilities available. Right? That's a mass amount of construction happening all over the country to to get those up and functional right now. It's also just an incredible amount of capital. Uh let's talk about that with Cororee. We we know Cororeeve IPOed and had crazy interest when it it first IPOed last year. Since then, the stock has done a a little wavering since then, for sure. Uh, but I know one of the things that investors were so excited about early on was Nvidia's uh connection to Corewave. Is that investment still there? And are we seeing other investors kind of pouring into the mass growth phase that Core Wave is in? To say they have a investment from Nvidia is probably an understatement because these two are tied together in ways that is probably what excites a lot of investors the most about Coree. Nvidia is a GPU supplier. They're in fact they're Core's primary chip vendor. They're an equity stakeholder in Core. They they own approximate they have about a 13% stake in Cororee. They signed an agreement in September of last year 2025. It's a $6.3 billion agreement that serves as a backs stop for Coreeave. Nvidia will purchase any unused Coreweave cloud capacity through April 2032. That's a nice little backup for them. Um, and then they have a master services agreement. Either party can terminate on 30 days notice for breach or immediately if the other enters bankruptcy proceedings. That's kind of interesting and it kind of also adds to the risk when you start looking at Corewave. >> It's interesting that this company is further down on the the more risky. There's one other stock in this category that you think is an even greater risk and we're about to get to that. But you have Cororeweave as one of the riskier ones. Is that just because there's one company that's tied up in so much of the funding? What else are you looking at when you uh evaluate the risk for Coreeave compared to Nebus and Iron? >> When I look at the risk for Coree, I'm looking at it more in a fundamental way. I might get some push back from our viewers on this one, but this is how I look at it. They got a gross margin of around 71%, which is outstanding, but they had a negative profit margin of around -23%. I'm having a little bit of a hard time reconciling this idea that you're generating a lot of money, you're generating a lot of revenue, and you're not being able to make that profitable. And I'm not necessarily seeing where the path is for that to become profitable. It seems to me that the backlog is extraordinary, but the interest coverage isn't that high. Their earnings before interest in taxes and stuff, it's barely covering 20 cents of every dollar of interest expense. So, it's more of a fundamental argument digging into the balance sheet, but I think that's where the risk comes in is you're going to have to really see this company grow aggressively. And so, I'm giving I'm putting them at about a seven. I said Nebius was around a four. I put iron in that five six group and I'm putting Cororeweave in at seven. I think that's the risk for them and it's just they're generating a lot of revenue and they're they've got to find a way to make that profitable. The math isn't quite working for me right now. >> Yeah. And I think that kind of shows up in what has been happening with this chart. The stock price for Coree kind of illustrates that risk. I think there's definitely other investors in the market who are seeing that risk potential too because this stock has been all over the place. Uh, again, I already mentioned that the extreme excitement that we saw early on when it first IPOed. It's been all over the place since then. I mean, for a year to date, I think it's still up uh not quite 50%, so it's doing fairly well now. It could drop just as quickly, too. There's been so much volatility in this name. And I think um analysts are struggling to figure out what to price this stock as well. There's potential there, but everyone's trying to figure out what is the true value of this stock. And that's a little bit true of the category itself, too. you know, right now, um, Corwin is trading below its consensus price target, and that's despite about a 50% runup this year. So, analysts clearly like it. It It's not like analysts are saying that it doesn't have a story. But, I do notice that just in the middle of May, DADavidson lowered their price target significantly from 175 to 100. So they seem like an outlier because many other analysts have been raising their price targets, but that's sort of one of those that it's more one of the more recent ones and it's more negative. So there's just going to be some people that just don't like it. So >> yes, and it's still very early in core story. Much like all of the names we're talking about today, this whole uh AI data centers as landlords business is very very new. Uh and it's still very much in the construction phase. So we'll see what Cory's future holds. You're just saying there is a lot of potential here, but it is more on the risky side than the other two names we've already discussed in this video. Let's get on to the one that you consider the most risk, but is still a major player in this AI data center buildout space. >> It is, and it's Applied Digital. And I know we've talked about this a ton on the channel. I know this is one of the ones that almost comes up every time we do a Market Beat Monday. Apply Digital comes in. Where Appli Digital fits in this story is they're providing an infrastructure layer. They sit closer to the power the physical buildings more so than as a cloud infrastructure play. One of the things about this company is Nvidia has reduced their stake in Applied Digital. It hasn't really been affecting the stock which is still up about 45% in the last month. >> Yeah, like you said, this is a name that we've talked about for quite a while. I think we started talking about Applied Digital on the channel when it was around the $5 mark and it has gone up tremendously since then. This one's up over 550% in the last year. Much like the other names we've seen on this this story so far. These names have seen tremendous growth. But I think the question investors have is is it running too far ahead? Everybody's pricing in the potential of the payoff these companies, Applied Digital being one of them, will have once those AI data centers they're building are functional and actually bringing in that monthly revenue or whatever revenue they're getting from the contracts that they're signing with these hyperscalers. But why do you see more risk in applied digital than the other names that are in the same boat? Their stock charts look similar. Huge interest, huge excitement from investors. Why is the risk here higher to you? I'm putting it as the most dangerous because the risk is compounded because it's not just exposed to the risks that we've talked about from if we build it will will they get the customers but they're already they're already they're also directly exposed to coreweaves risks on top of its own of their of the $16 billion that they have in contracted revenue 11 billion of that 69% is attributable to coreweave if coreweave which I've already said is probably around a seven. If it stumbles because of its debt, then that is going to affect Applied Digital's revenue visibility. That's why I'm putting um Applied Digital as the highest risk of the of the four that we've talked about today. >> So, interesting to see. This is another of those names that started out as a Bitcoin mining company and like iron made that switch into the the data center space and they seem to be doubling down as well. Let's talk about where they stand in that physical race of actually getting these buildings up and running. So right now, Applied Digital is a three campus story and nothing more than that. They've got two sites operational. The Polaris Forge building one and building two in North Dakota. They've also got Polaris Forge 2 under construction also again in North Dakota. They're expecting that to go online sometime in early 2027. And then they've got another location. The project name is Delta Forge 1. They broke ground in on that project in January 2026. Target date is 2028. >> Yeah. And full disclosure here, that applied digital site going up is right in my hometown in this tiny town in North Dakota where I am from. And I I've actually seen that construction firsthand. It is such a massive site and there's so much money going into all of this. There's hundreds of electricians working on these projects, not to mention all the materials and things going into them. So, the process is a long time. The capital is extensive. Uh but the payoff is the goal, right? That's the payoff for this company and all those that we've talked about. And I know you mentioned the timeline when we were talking about another company earlier. But what do you think the timeline is for profitability after this initial mass investment? And is it possible that any of these four names we've talked about today won't get to that finish line because they could run out of capital? Is that a possibility? Or is there too much demand at stake here for what they're building for it to fail? >> They're just going to need to see the growth. We're just going to need to see that the demand that is very real today continues to be real over the next year or two years. There's nothing saying it won't be. Physical AI is coming. There's going to have to be even more data center demand when we have autonomous vehicles, when we have uh Elon Musk's army of humanoid robots. That's data center demand beyond what we're seeing now. So, I think all of them look very promising. It's just you've always got those black swans or gray swans that you just don't know that could pop up. >> Yeah, I have another really important question on the Elon Musk factor coming up in a second. But if you are thinking about the uh humanoid robots and that physical AI story, I do want to share a brand new article we have on the website on the five robotic stocks to watch as physical AI builds massive momentum. And really, there is so much momentum in this sector right now, just in the last month. You can scan the QR code or click the link in the description to get that article for free right now on marketbeat.com and check out those other five names. But the other big Elon question here, Chris, is talking about the move of AI data centers to space. This is the wildcard uh question I have for all of the these companies that are building this huge amount of capital to build these out on the ground in the US. And what if this plan to move data centers to space actually pans out and it becomes a more effective way to build out these data centers? I do think that's a long way off. I want to hear your take, but my thoughts are that that's a long way off. That's not going to happen anytime in the next 2 to 5 years. It's going to take a little bit longer than that. Um, and so is there still a place for these companies to profit? What do you think? What kind of impact could that wild card have on the buildout that's happening on the ground right now? Some of these companies would become very challenged in that regard, but I don't think data centers in space is going to eliminate the need for data centers that we have currently on the ground. Bridget, I did not pay enough attention in my science classes to be able to tell you how feasible this is or when this is going to happen. But I can tell you this today, I can get my mind a lot easier around the idea of us actually landing on Mars than I could probably 10 years ago. And I probably couldn't see it then and I can see it more now. And I think that's really how this is going to come out is there's a plan. A lot of investors aren't seeing that yet, but the investors who are willing to invest in that today and are willing to take that risk could see a gigantic payoff. But it's hard to get your mind around that right now. >> That's certainly what we're hearing from people in the comments of people saying that this is a crazy moonshot idea that might not happen and others saying so many things we said wouldn't happen are happening today. So, >> exactly. >> We love to hear your thoughts in the comments. So, do you think that data centers in space could potentially in the future eat up some of the business that these AI data centers on the ground could have in the future? Let me know your thoughts in the comments. And if you want to learn more about that physical AI story, we have a great interview. It's been really popular on the the channel so far. If you haven't caught it yet, make sure to watch it for a list of the stocks to consider in this physical AI story that's really just beginning now. You can watch that interview